Secrets for Wise Investing

Secrets for Wise Investing

Don’t wait around for the “next big thing.”
Many investors spend too much time searching for the next hot company while successful investors are more concerned with finding a low-priced quality fund or low-cost index.

Know your risk tolerance and cap it.
Wise investors consider how much they can afford to lose before making an investment decision. It is important to set an end goal so you can make appropriate investment decisions. Based off your year-end goals, you can balance your investment weight between relatively safe investments and those that are more risky.

The unpopular can be powerful.
Good investments can be found in less popular companies too. Think of industries used in everyday life, such as pharmaceutical companies, fuel and automotive companies, as these might not be in the headlines everyday but still make a good investment.

Keep an eye on your investment fees.
Many savvy investors focus on portfolios with a low frequency of turn overs and broad diversification at the lowest costs. Know the fees associated with your investment choice so they are not over diminishing your return.

Do not panic.
Emotions can sting in the short term, but it is important to remain focused on the long-term and let panic subside. When building a portfolio, take the long-term approach and ignore the daily ups and downs of the market.

Source: Vasel, Kathryn. “5 Investing Secrets of the Wealthy.” CNN Money. Cable News Network, 30 Sept. 2014. Web. December 2014.
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